STOCKS CRATER: Dow plunges over 1100 points in wild trade, Australian market set to tank

Photo: Mario Tama/ Getty Images.

  • A chaotic trading session on Wall Street saw the Dow plunge as much as 1500 points before recovering. It closed down more than 4% for the day.
  • The broader S&P500 was also down more than 4% after a late rally failed.
  • Volatility measures exploded while bond yields fell as investors piled into safe-haven assets.
  • ASX futures were down more than 2.5%, pointing to heavy losses on the Australian market today.

  • The US stock market plunged in Monday trade, following up its heavy losses on Friday.

    The Dow closed down 4.5%, or almost 1200 points, while the broader S&P 500 was down 4.3% or over 110 points. The tech-heavy Nasdaq was also crushed, finishing down 264 points or 3.91%. Only two stocks in the S&P500 finished higher for the day.

    ASX futures were down 158 points, or 2.65%, according to data from investing.com, pointing to a likely savage sell-off spilling into trade in Australia.

    Bond yields fell as investors bought the safer assets, in a reversal of the price action last week, when surging bond yields on Friday triggered the initial sell-off on Wall Street.

    “Suddenly, inflation has become one of the most-talked about issues in markets, reviving many late-cycle concerns over Fed tightening, corporate margins, volatility, stock/bond correlations and hedging strategies versus asset allocation,” JPMorgan strategist John Normand wrote in a note to clients Monday.

    Wells Fargo was the biggest losing stock in the S&P 500 on Monday. Shares of the bank fell 9.93% to $57.71 after the Federal Reserve barred the bank from growing any larger until it improves its compliance and governance policies.

    ExxonMobil saw the biggest drop in the Dow, down more than 6%.

    The White House downplayed the severity of the selloff. White House Deputy Press Secretary Raj Shah told reporters “markets do fluctuate” and “the fundamentals of this economy are very strong.”

    Here’s a chart showing the Dow Jones Industrial Average during the Wall St trading session.

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